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ECONOMIC DEVELOPMENT 588
tion would be, to a large extent, recoverable in case an economic or political crisis created a contraction in the circulation. In any case the part sunk in fixed investment would in no way endanger the convertibility of the note issue because at least 80 per cent of the note issue is now-a-days normally inconvertible. In other words, the Government cannot sell its own loans which it holds in order to attract silver. Whenever there is a demand for the encashment of notes, it can sell its loans for currency notes, and thus contract the issue; but very little
